Prospectus re Admission to the Official List - Heritage Oil

The post tax Net Present Value (NPV) at various discount rates 4 applying the RPS Base Case priceforecasts are tabulated in Table 8.Post-Tax Net Present ValueEconomic(US$ Million, Money of the Day)Limit (1) 5% 7.5% 10% 12.5% 15%Net Heritage ShareBukha Field, OmanProved Reserves (1P) ...................... 2029 2.2 1.7 1.4 1.2 1.0Proved plus Probable Reserves (2P) ........... 2029 2.8 2.1 1.7 1.4 1.2Proved plus Probable plus Possible Reserves (3P) . . 2029 3.0 2.3 1.7 1.4 1.2West Bukha Field, OmanProved Reserves (1P) ...................... 2037 15.5 13.2 11.4 9.9 8.7Proved plus Probable Reserves (2P) ........... 2037 39.9 35.1 31.3 28.3 25.7Proved plus Probable plus Possible Reserves (3P) . . 2037 79.7 68.6 60.2 53.6 48.3Zapadno Chumpasskoye Field, RussiaProved Reserves (1P) ...................... 2025 69.1 40.2 17.5 0.2 32.9Proved plus Probable Reserves (2P) ........... 2029 413.6 308.0 226.6 163.5 46.7Proved plus Probable plus Possible Reserves (3P) . . 2031 1356.2 1013.7 762.2 574.5 238.2Note(1) Economic limit represents last year of input forecast production.Table 8: Post-Tax Valuation (Net Heritage Share) of Heritage’s Reserves as of 30 th September 2007The only 1C, 2C and 3C contingent and prospective resources in the portfolio are in Block 1 and 3A,Uganda and, at the request of Heritage, were not valued.Heritage was awarded a PSC for the Miran block in Kurdistan on 2 nd October 2007. There is insufficientdata to estimate volumes of prospective resources in Miran at this stage. However in order to indicatepossible value of the block RPS has, based on its detailed understanding of fields in the vicinity, made anestimate of the relationship between field size and value in the success case. Based on a low-mid-highrange of 900 1,950 3,500 MMstb notional STOIIP, RPS has developed production and cost profilesand a relationship between field size and value in the success case. Average success case NPV 10 perrecoverable barrel is given in Table 9:Miran ........................Table 9:Value (NPV 10 )per recoverable barrelUS$2.6Success Case NPV 10 US$/per Recoverable Barrel (p50 case)QualificationsRPS is an independent consultancy specialising in petroleum reservoir evaluation and economic analysis.Except for the provision of professional services on a fee basis, RPS does not have a commercialarrangement with any other person or company involved in the interests that are the subject of this report.Mr Roy Kelly, Technical Director, Reservoir Engineering for RPS Energy, has supervised the evaluation.Mr. Kelly has over 25 years oil and gas experience with international oil companies, as well as withinternational consultancies. He is a Member of the Society of Petroleum Engineers and a Fellow of theEnergy Institute, as well as being a Chartered Petroleum Engineer. Other RPS Energy employees involvedin this work hold at least a Masters degree in geology, geophysics, petroleum engineering or a relatedsubject or have at least five years of relevant experience in the practice of geology, geophysics or petroleumengineering.Basis of OpinionThe evaluation presented herein reflects our informed judgement based on accepted standards ofprofessional investigation, but is subject to generally recognised uncertainties associated with theinterpretation of geological, geophysical and engineering data. The evaluation has been conducted within67